Motion blur not applying to rigged propeller
I can't be quite certain WHY, but Cycles isn't properly understanding the mesh distortion that your armature is doing. When I separated the moving parts of the rotor from the mast into two separate objects, and then animated the rotor object instead of the armature, the rotors blurred properly:



I suspect the armature isn't what's causing the problem, rather that it's the mesh distortion. Here's why: I also tried animating a shape-key instead of using the armature (with the whole mesh as one object), and Cycles did the same thing you're seeing. So, it must have something to do with Cycles not properly blurring meshes when they are deformed, instead of TRANSformed (LocRotScale). Even turning on "Deformation" in the motion blur settings for the mesh didn't change anything.

I suspect that you can still use the armature, so long as the moving components are a separate object from the non-moving components (or from components that move differently). I'd wager that your test rotor was also a separate object from the two cubes below it, and that's why it blurred properly.

This MIGHT be a bug. I'd recommend looking in the forums to see if it's been discovered. In the mean-time, it's somewhat more conventional to separate a mesh by moving parts, anyway ;-)

I hope that helps!